In this study, we examine the telomeric functions of the mammalian Mre11 complex by using hypomorphic Mre11 and Nbs1 mutants (Mre11(ATLD1/ATLD1) and Nbs1(Delta)(B/)(DeltaB), respectively). No telomere shortening was observed in Mre11(ATLD1/ATLD1) cells after extensive passage through culture, and the rate of telomere shortening in telomerase-deficient (Tert(Delta)(/)(Delta)) Mre11(ATLD1/ATLD1) cells was the same as that in Tert(Delta)(/)(Delta) alone. Although telomeres from late-passage Mre11(ATLD1/ATLD1) Tert(Delta)(/)(Delta) cells were as short as those from Tert(Delta)(/)(Delta), the incidence of telomere fusions was reduced. This effect on fusions was also evident upon acute telomere dysfunction in Mre11(ATLD1/ATLD1) and Nbs1(Delta)(B/)(DeltaB) cells rendered Trf2 deficient by cre-mediated TRF2 inactivation than in wild-type cells. The residual fusions formed in Mre11 complex mutant cells exhibited a strong tendency toward chromatid fusions, with an almost complete bias for fusion of telomeres replicated by the leading strand. Finally, the response to acute telomere dysfunction was strongly impaired by Mre11 complex hypomorphism, as the formation of telomere dysfunction-induced DNA damage foci was reduced in both cre-infected Mre11(ATLD1/ATLD1) Trf2(F/)(Delta) and Nbs1(Delta)(B/)(DeltaB) Trf2(F/F) cells. These data indicate that the Mre11 complex influences the cellular response to telomere dysfunction, reminiscent of its influence on the response to interstitial DNA breaks, and suggest that it may promote telomeric DNA end processing during DNA replication.